CHAPTER 3 STUDY GUIDE 1. a. b. c. d. e. 2. a. b. c. A _____ is a defined group that managers feel is most likely to buy a firm's product.

target market buying center mass market consumer cluster demography

The target market for the firm's product will: remain stable over time, with the same group of consumers change over time--consumers will drop in or out of the market, and tastes will change not have its needs strongly affected by changes external to the product itself such as environmental factors d. change only because of the changing nature of product offerings e. not be specifically defined according to age, income, or location because these factors are continually changing 3. Mia Diver is the director of marketing for an Internet company that sells educational toys to parents and grandparents. The company is developing a marketing plan that must cover the next five years of business. Diver must be sure she considers which of the following uncontrollable factors in her plan? a. place or distribution factors b. media buying factors c. demographic factors d. office layout factors e. pricing for services 4. Marketing managers cannot control certain elements that continually mold and reshape consumers and the marketplace. These elements are the: a. product itself b. external environment c. sales force d. distribution strategy e. research department 5. The external environment is a strong influence on a target market, and can be a source of _____ for the marketing manager. a. opportunities and threats b. threats and strengths c. new customers and future customers d. opportunities and weaknesses e. competition 6. When a company implements strategies that attempt to shape the external environment in which it operates, it is engaging in: a. mold planning b. environmental management c. conditioning d. market control

e. reactive management 7. The Brown Shoe Company, based in Illinois, has spent a great deal of time and effort trying to influence the passage of bills in Congress that would limit the number of foreign-made shoes that can be shipped into the United States. The Brown Shoe Company is engaging in: a. defensive marketing b. illegal practices c. environmental management d. legislative planning e. corporate espionage 8. The environmental factors concerned with the changes in people's values, lifestyles, and family roles are called: a. social factors b. economic factors c. political factors d. competitive factors e. demographic factors 9. The most difficult external variable for marketing managers to forecast or influence into their plans would be _____ factors. a. political b. economic c. social d. legal e. demographic 10. a. b. c. d. e. 11. a. b. c. d. e. Marketers consider the phenomenon of poverty of time to be a(n) _____ factor. economic political and legal technological demographic social An example of a business that caters to dual-career, baby boomer families is: fast lube/10-minute oil changes for cars an exterminator service (bugs, rodents) a liquor store with over 2,000 varieties of wine a chain bookstore a florist

12. Your firm is planning to develop a product, service, or idea that would combat the poverty of time problem. Which of the following ideas would best help target this problem? a. the creation of a supermall, containing millions of square feet of shopping space and hundreds of stores from which customers can shop b. exotic foreign shopping excursions c. computerized shopping services d. do-it-yourself garden equipment

e. cooking-from-scratch classes 13. Jackie is a certified public accountant with a national firm. She is also a certified scuba diver, published poet, and a single parent. Her other interests include sewing, woodworking, and chamber music. Marketers would describe Jackie's needs for goods and services as: a. fitting into a single parent segment b. the typical accountant target segment c. inappropriate in all segments d. a component lifestyle e. a conforming lifestyle 14. a. b. c. d. e. 15. a. b. c. d. e. 16. a. b. c. The study of people's vital statistics, such as their ages, births, deaths, and locations, is called: sociology psychology ecology geography demography Which of the following is NOT likely to be a demographic characteristic of a population? income level age lifestyle education birth rate

Which of the following statements about Generation Y is true? Its members are people who were born between 1965 and 1978. It is more than three times as large as Generation X. The members of Generation Y don't mind indulging themselves with restaurant meals, clothing, and electronic items. d. Members of Generation Y are the first generation of latchkey kids. e. All of the above statements about Generation Y are true. 17. a. b. c. d. e. 18. a. b. c. d. e. Where should a marketer advertise to reach members of Generation Y? on television shows that their parents enjoy in business magazines during an MTV presentation on Spring Break in Florida on two-dimensional billboards at simple point-of-purchase displays in supermarkets Consumers born between about 1966 and 1977 are a group called: baby boomers yuppies pre-teen shoppers America's mass market generation X

19. Which of the following statements about Generation X is true?

a. The members of Generation X do not mind indulging themselves. b. The members of Generation X consider individualism to be the most important defining characteristic. c. Gen Xers are more likely to buy investment properties rather than clothing or electronic items. d. Gen Xers are less materialistic than past generations and thus have a greater hope of achieving their limited goals. e. The children of Generation X were the first latchkey kids. 20. Elizabeth is opening a drop-off baby-sitting service in an affluent Dallas neighborhood. Market research reveals that most of her customers are baby boomers with above-average incomes (because they are often dual-career couples). Elizabeth appears to be aware of one important value this group cherishes, which is: a. conformity b. me-first c. convenience d. materialism e. accomplishment 21. Many marketers have enduring misconceptions about older adults, all based on stereotypes. Which of the following statements most accurately describes older consumers? a. Older consumers read more and watch less television than younger consumers. b. Older consumers are sick or ailing. c. Older consumers are sedentary. d. Older consumers are interested only in price and are intolerant to change. e. Older consumers do not remember advertisements in printed materials. 22. Location trends of consumers are important to businesses when they are planning expansions. It is important to note that the average U.S. citizen moves every _____ years. a. six b. two c. twenty d. twelve e. ten 23. A Korean grocery store in an urban area with a high degree of multiculturalism sells products that are used in Korean cuisine and that are unavailable at traditional U.S. supermarkets. The Korean grocery store is dealing with the region's multiculturalism by: a. using niche marketing b. maintaining its core identity while targeting a heterogeneous market c. treating its customers as a homogeneous market d. molding itself to meet the individual needs of its customers e. using mass marketing instead of target marketing 24. a. b. c. d. Stitching niches is a marketing strategy that involves: maintaining a brand's core identity while straddling different languages recognizing that ethnic markets are monolithic creating a unique marketing mix to meet the needs of an ethnic market combining ethnic, age, income and lifestyle markets on some common basis to form a

mass market e. combining brand extensions to appeal to a specific niche market 25. Factors, such as interest rates, inflation, and consumer income that influence the marketing environment, are called _____ factors. a. economic b. socio-demographic c. political d. government e. technical 26. a. b. c. d. e. 27. a. b. c. d. e. _____ is primarily responsible for the rise in disposable income in the United States. Multiculturism The personalized economy The increasing number of dual-income families The aging of the baby boomers Global competition A general rise in prices of goods and services resulting in decreased purchasing power is called: inflation recession depression economic slowdown price escalation

28. When planning marketing strategies during times of inflation, marketers must be aware that inflation causes consumers to: a. purchase more goods and services to support their psychological selves, such as counseling and stress management training b. consume more meals away from home c. buy in small quantities until inflation is over d. decrease their brand loyalty to products they have traditionally used e. put more money into savings accounts because prices are too high 29. A period of economic activity when income, production, and employment tend to fall, reducing overall demand, is called: a. stagnation b. inflation c. recession d. price escalation e. depression 30. Research that attempts to expand the frontiers of knowledge rather than solving a specific, pragmatic problem is: a. R&D b. non-pure research c. applied research d. concept research

e. basic research 31. The scientists at Motorola are trying to create Iridium, a constellation of sixty-six satellites that will offer telephone service anywhere on the globe. This is an example of: a. R&D b. non-pure research c. applied research d. concept research e. basic research 32. Laws and regulations of various governments and their ongoing development and change are an example of the uncontrollable elements of the market called _____ factors. a. economic investment b. political and legal c. research and development d. competitive e. demographic 33. The governmental body that has the power to prescribe mandatory safety standards for almost all products consumers use is the: a. Health and Welfare Agency b. Federal Trade Commission c. Food and Drug Administration d. Federal Communications Commission e. Consumer Product Safety Commission 34. A law devised to protect consumers from funeral homes that took advantage of their customer's emotional state by selling them more services than they really wanted to could reasonably afford is the type of legislation that would be: a. Food and Drug Administration b. Federal Communications Commission c. Department of Education d. National Association of Broadcasters e. Federal Trade Commission 35. When an agency of the federal government requires a firm to give refunds to consumers who were misled by the firm's advertising, it has used the remedy of: a. affirmative advertising b. cease and desist order c. restitution d. counteradvertising e. restoration 36. The government agency charged with enforcing regulations against selling and distributing adulterated, misbranded, or hazardous products of a specific type is the: a. Federal Trade Commission b. Consumer Product Protection Commission c. U.S. Justice Department

d. Food & Drug Administration e. American Medical Association 37. The number of firms a company must face, the relative size of these firms, and the degree of interdependence within the industry are all part of its _____ environment. a. demographic b. economic c. political d. competitive e. social